Sole trading is a business organization, in which an individual invests the

complete amount of capital, manages the business affairs himself or

herself, bears all the risks alone, enjoys all the profits and bears all the
losses of his own. Such type of business organisation is called as Sole
Trading Concern. Sole proprietorship is the most common form of business
organisation found in India. Sole proprietorship is the easiest form of
business organisation. sole proprietorship is suitable for small and medium
business.
The most important feature of sole trading concerns is that, it does not enjoy
separate legal status. From the point of view of Law, the sole trader and his
business are considered one and the same. The success of sole
proprietorship is completely depends on the ability of the proprietor but it
offer maximum managerial control over business.

A partnership firm is an business organization which is formed with two or

more persons to run a business with a view to earn profit. Each member of
such a group is known as partner and collectively known as partnership
firm. Partnership firms are administered by the Indian Partnership Act,
1932
According the Section 4 of Indian Partnership Act, 1932 defines
partnership as - “Partnership is the relation between persons who have
agreed to share the profits of a business carried on by all or any of them
acting for all.

The individual who entered into agreement to form a partnership with

another are called as partner and collectively known as partnership firm.
The partnership is always is contractual in nature.

A joint stock company is a voluntary association established for the purpose

of carrying on some business activity. Joint Stock Company is a voluntary
association of persons who generally contribute capital, to perform
particular type of business. The joint company is an artificial person created
 by law. A Joint Stock Company is having a separate legal entity with a
perpetual succession and a Common Seal.

The total capital of Joint Stock Company is known ‘Share Capital’. It is

divided into small units called ‘Shares’. Every member holds some shares.
These, members are called as ‘Shareholders’.In India, every joint stock
company is registered as per “The Companies Act, 2013”.
According to The Companies Act 2013, Section 2 (20), the term
“Company” to mean

“A Company incorporated under the Companies Act 2013 or any previous

Company law.”

Comparative

Point for Sole Trading Partnership Joint Stock

Comparison Concern Firm Company

Easy and Easy Lengthy &

Formation Simple Formation Expensive
formation Formation

Minimum 02 Private Company :-

No. of Members Single Owner Minimum :- 02
& Maximum 50 Maximum :-200
Public Company :-
Minimum :- 07
Maximum :-No Limit

Unlimited & Limited

Liability Unlimited Joint

Capital Limited Limited but Unlimited

Investment Investment more than sole
proprietorship

Continuity & Very Unstable More stable than Very Stable

Stability sole
proprietorship